Deadline extended for marketplace seller tax amnesty program

Retailers that sell through online marketplaces (e.g. FBA sellers) now have a little more time to weigh the pros and cons of a temporary online marketplace seller tax amnesty program. Instead of concluding on Oct. 17, 2017, as initially planned, the multistate online marketplace seller voluntary disclosure initiative will run through Nov. 1, 2017.

The program provides an opportunity for online marketplace sellers to erase some or all back sales/use and income/franchise tax liability in one or more of the 25 participating states. However, the decision to participate shouldn’t be made lightly: Sellers must register and collect and remit applicable taxes in the states that grant them full or partial amnesty by Dec. 1, 2017, or within 30 days of receiving notice that the states have signed the agreement.

The application period extension was granted by the Nexus Committee of the Multistate Tax Commission, which is overseeing the program. They also decided to allow participating sellers more time to register with states that grant them amnesty. Under the program’s original terms, all sellers would have had to meet the Dec. 1, registration deadline. Now, sellers have 30 days after the receipt of a signed agreement to register and comply with the state’s tax laws. This will help those that don’t receive a signed agreement back from states until after Nov. 1.